Households are considered by the Government to be in 'fuel poverty' if they
would have to spend more than 10% of their household income on fuel to keep their home
in a 'satisfactory' condition. It is
thus a measure which compares income with what the fuel costs 'should be' rather
than what they actually are. Whether a household is in fuel poverty or not
is determined by the interaction of a number of factors, but the three
obvious ones are:

The cost of energy.

The energy efficiency of the property (and therefore, the energy
required to heat and power the home)

Household income.

All the points below relate to England only.

4.0 million households in England were classified as being in fuel poverty
in 2009 (18% of all households). This is three time the number of
households that were in fuel poverty at the low point in 2003, and there
have been increases in each year since 2003. It is, however, still
lower than the number in the mid-1990s.

Fuel poverty is most common among those live in private
rented accommodation: averaging from 2007 to 2009, 20% of households in private rented accommodation
were in fuel poverty compared to around 15% in other tenures.

Despite their much lower average incomes, those in social
rented accommodation are only a bit more likely to be in fuel poverty than
owner-occupiers. This is partly because very little social housing is energy
inefficient (see the indicator on energy efficiency)
and partly because social housing tends to be small, both factors meaning that relatively little fuel
is required to keep the home warm.

Analysis of the relationship between fuel poverty and household income
depends in part on whether the household incomes are analysed before or
after deducting housing costs. Prior to the latest
2006 data, only before deducting housing cost incomes could be used (because
the relevant survey did not collect data on housing costs) but, from
2006, either before or after deducting housing cost incomes can be
used. A further complication is that the relationship changes
when levels of fuel poverty change substantially, as they have done in the
last few years. In this context, the focus of the points below is on
the the qualitative patterns rather than the quantitative proportions.
Furthermore, in keeping with the approach used throughout this website, all
the quantitative points relate to households
grouped according to their incomes after, rather than before, deducting housing costs.

The risk of fuel poverty rises sharply as household income falls and,
for example, very few households with above-average incomes are in fuel
poverty: averaging across 2007 to 2009, around two-fifths of households in the
poorest fifth after deducting housing costs were in fuel poverty. Even
so,
a majority of households in the poorest fifth were not in fuel poverty and, furthermore, there
were a substantial number of households who are not in the poorest fifth but
who are nevertheless in fuel poverty (around half of the total number in
fuel poverty). Clearly, therefore, there are factors other than household income which
affect whether a household is in fuel poverty or not.

One such factor is how energy
efficient the home is. For example, households not in the poorest
fifth but in very energy inefficient homes are actually more likely to be in fuel
poverty than households in the poorest fifth but in homes with above-average
energy efficiency. More specifically, averaging across 2007 to 2009,
around two-fifths of households
not in the poorest fifth after deducting housing costs but living in
homes with a SAP rating (see the
indicator on energy efficiency for a definition) of less than 30 were in
fuel poverty compared with around a third of households in the poorest fifth but
living in homes with a SAP rating of 50 or above. One result of
this is that households who are both in the poorest fifth and in very energy
inefficient homes are at a very high risk of fuel poverty (85%, averaging
across 2007 to 2009).

A second such factor is the composition of the household.
Single-person households - working-age singles as well as single pensioners
- are more likely to be in fuel poverty than either couples or larger
families. Overall, averaging across 2007 to 2009, around 35% of single pensioners and 25% of
working-age singles were in fuel poverty compared to around 20% of lone
parents (the next highest group), 15% of pensioner couples, and 5% of
working-age couples. Because of their relatively high risk, half
of all the households in fuel poverty in England are single-person
households even though only a quarter of all households are single-person
households.

Among those in low income, single-person households are also more likely
to be in fuel poverty than either couples or larger families and
this applies particularly to working-age singles (rates for pensioner singles
are a bit lower). The analysis in Cold and poor: an
analysis of the link between fuel poverty and low incomesuggests that the reason for the high risk of fuel poverty
among single-person households, both overall and among those in low income, is that, whereas their estimated fuel costs tend to be a bit lower
than those for other household types, their household incomes tends to be a
lot lower. In other words, fuel costs tend to be a bigger burden, relative
to incomes, for single-person households than for larger households.

Finally, households in rural areas are more likely to be in fuel poverty
than those in urban areas (averaging across 2007 to 2009, 20% in rural compared with 15%
in urban), with similar proportional differences those in low
income (for the poorest fifth, averaging across 2007 to 2009, 40% in rural
compared with 40% in urban)

The analysis above suggests that two of the major groups of concern from
a fuel poverty perspective relate to those in low income who are either
single-person households of working age and or who live in rural areas.
This is notable because these two groups have not been the focus of
government's more general anti-poverty strategy, which has tended to focus on
children, older people and deprived urban areas.

Within England, fuel poverty is most prevalent in West Midlands and the
North East.

People who are in fuel poverty are either paying a high
proportion of their income for the essential purposes of keeping their homes
warm, cooking, etc or are not using the amounts of fuel that are required to
keep their home in a satisfactory living condition.

The first graph shows the number of households deemed to
be in 'fuel poverty', with the data shown separately by tenure.

The second graph shows the proportion of
households in fuel poverty in each tenure.

Households are considered to be in 'fuel poverty' if they
would have to spend more than 10% of their household income on fuel to keep their home
in a 'satisfactory' condition, where, for example, a 'satisfactory' heating
regime is considered to be one where the main living area is at 21 degrees
centigrade with 18 degrees centigrade in the other occupied rooms. It is
thus a measure which compares income with what the fuel costs should be rather
than what they actually are. Household income is disposable household
income before deducting housing costs, with Housing Benefit and Income Support
for Mortgage Interest both counted as income. The fuel costs included comprise
that used for space heating, water heating, lighting, cooking and household
appliances.

The third graph to sixth graphs show how the proportion
of households that are in fuel poverty varies by the income of
household. In the third graph, the basic statistics by household income
quintile are presented. In the fourth graph, the data is broken down by the energy
efficiency of the home (for the definition of energy efficiency, see the indicator on energy efficiency).
In the fifth graph, the data is broken down by household type (single person,
couple with children, etc). In the sixth graph, the data is broken down by
type of area (rural, urban, etc), using
the government's 2004 classification system for small areas whereby
household living in settlements of more than 10,000 are classified as 'urban'
and those who are not are classified as 'rural'. To improve their
statistical reliability, the data is the average for the latest three years.

The allocation of households to the poorest fifth uses 'equivalised household
income' after deducting housing costs, which means that the household incomes
have been adjusted to put them on a like-for-like basis given the size and
composition of the households. This means that the results are somewhat
different than those in some other publications which either use unadjusted
household incomes or incomes before deducting housing costs.
It could be argued that, because the definition of fuel
poverty uses household incomes before deducting housing costs, then the
allocation of household to income quintiles should also use the same before
deducting housing cost incomes. Our response is that a) when allocating
households to income groups, we use after deducting housing cost incomes
throughout this website (for the reasons set out on the page on choices of
low-income thresholds) and b) when analysing any particular subjects
(such as fuel poverty), we always stick to the official Government definitions.
So, from this perspective, the issue is more for the Government (i.e. should
they change the definition of fuel poverty so that it uses household incomes
after deducting housing costs?) than for us. Note that such a change would
not be the same as using the 'basic income definition' of fuel poverty as this
definition does not
deducting rent, mortgage interest, etc from the household incomes.
Finally, it is worth noting that,
whilst the specific proportions in the graphs would sometimes be
materially different if the income groupings were based on before deducting
housing cost incomes, their overall patterns would generally be similar to those
presented in the graphs using after deducting housing cost incomes.

The seventh graph shows how the proportion of households in fuel poverty
varies by region. Note that equivalent data is not
available at a sub-regional level because the sample size of the relevant survey
(the English Housing Survey)
is totally insufficient to derive sub-regional estimates. Any sub-regional
estimates published by academics are the
output of computer models and are NOT based on actual data.

The data source for all the graphs is
the stock dataset from the
English Housing Survey (EHS)
and relates to England. The 1996 data in the first graph has been amended
by the government from their original estimate of 4.3 million to take account
of DTI gas and electricity bill data and is taken from the 3rd annual progress
report of the UK fuel poverty strategy.

Overall adequacy of the indicator: medium. EHS is a well-established,
regular government survey, designed to be nationally representative, but the
calculation of required fuel costs is both complex and obscure.

Overall aim: Increase long-term housing supply and affordability

Lead department

Official national targets

Increase the number of net additional homes provided per annum to 240,000 by 2016.

Increase the number of gross affordable homes provided per annum to
70,000 by 2010-11 including 45,000 social homes.

Halve the number of households in temporary accommodation to 50,500 households by 2010.

By March 2011, 80% of local planning authorities to have adopted the
necessary Development Plan Documents, in accordance with their agreed
Local Development Scheme.

Other indicators of progress

Trends in affordability.

Efficiency rating of new homes.

Previous 2004 targets

By 2010, bring all
social housing into decent condition with most of this improvement
taking place in deprived areas, and for vulnerable households in the
private sector, including families with children, increase the
proportion who live in homes that are in decent condition.

Eliminate fuel
poverty in vulnerable households in England by 2010 in line with the
Government's Fuel Poverty Strategy objective Joint with the department
for Trade and Industry.